i understand why. what are we doing to correct -- >> local local water supply projects? >> local water supply projects. all of them seem to be on budget. it is a priority to keep those moving as quickly as possible especially the fact we're looking at our 2018 deadline and how we're going to get our water supplies met. >> steve richy assistant general manager for water. actually, two of them are actually below budget, schedule with the problem on those, the primary one was the west water recycle project, which we went out with a notice of preparation for a proposed plant this in golden gate park. frankly ran into a lot of public opposition to that. so, we basically had to%conflict3v back from that and reto that. that notice of preparation for that e-i-r was actually scheduled to go out, i believe in april. * so, we're getting back on track on that after having to basically find a new location for the plant which took quite sometime to do that. so, that one should be ready to start moving forward as well. the groundwater project, the

draft e-i-r for the local groundwater project is scheduled to go out in the middle of next month, the middle of march. so, that one will be moving forward as well. the east side recycled water project, we're focusing on trying to find a site for that. that one is the longest one out there. that will take some time, but i do want to make sure you're assured that there's no intent on our part to delay or slow down. one of the reasons why they do show red is because we haven't -- we didn't find those any time recently. both still have dates that were projected dates from quite some years ago. it is now time to rebase, and we're about to go through that process right now. get ourselves on a good track with those. rest assured we are completely commit today moving those forward. >> great. and the rebaseline effort will be completed? >> i think we'll do it in the next month or maybe two. >> okay, great. >> actually, a discussion about water supply, those will be part of that discussion. >> okay, good. i want to go on record saying

we as a commission are supportive of moving those projects along and forward as quickly as possible. so, please keep us informed on what's happening. >> absolutely. >> thank you. >> thank you, commissioner. any other questions on this item? other commission business, item number 6? there being none, now we go to the long awaited report of the general manager. >> well, first i would like to recognize a very close friend of mine, a person who calls me in the morning or late at night to give me heads up about what's going on in the community. [laughter] >> and she's -- i've been knowing her for a very long time and she's been very instrumental in my life. i would like to call up dr. espinola jackson up here. (applause) >> she recently had a birthday

party at her second home, the southeast community center, and it was hundreds of people there, several hundred because people -- she had it from 3:00 to 8:00. i brought the whole family. we had an opportunity to take a photo op with her, and i will be selling that on ebay. [laughter] >> but it was amazing program. it was well attended. it gave me opportunity to connect with a lot of people i haven't seen in a long time. it was music. it was a lot of children who were singing and your party just really moved me. thank you. >> i wanted to personally thank you for the work that you do and keeping me out of trouble. [laughter] >> so, with that -- >> we have a resolution. i would like the commissioners to each state a couple whereases starting with commissioner vietor, the first two.

>> congratulations, first of all. thank you. >> very proud and honored to be able to present the part of the presentation of this resolution. whereas dr. espinola jackson exemplifies tireless community leadership and dedication to advancing opportunities and improving the lives of san francisco residents. and whereas known in the community as "the unofficial mayor of bayview hunters point" dr. he is p/e knoll a jackson was instrumental in the creation of the southeast community facility * to bring educational, employment, and community resources to the southeast. and... >> thank you, commissioner. doctor, whereas dr. espinola jackson has passion atly worked to improve the lives of african americans in san francisco, to organizing for welfare and labor rights and to her service on numerous committees and commissions including the san

francisco redevelopment joint housing committee, economic opportunity council, and the southeast facility commission, and whereas engaged frequent attendee of the san francisco public utilities commission meetings and southeast facility commission meetings, dr. espinola jackson collaborates with the san francisco public utilities commission and staff to improve our operations both in the bayview and throughout san francisco. and... >> and whereas on february 9th, 2013, dr. espinola jackson celebrated her 80th birthday and the lifetime of service to subpoena. -- san francisco. now therefore be it resolved... >> that this commission here by offers its highest commendations to espinola jackson on the celebration of her 80ing birthday. you look fabulous, by the way. [laughter] >> and honor her

accomplishments as community leader and quite frankly a humanitarian in san francisco. i might add as a personal note, as former chairman of the california democratic party, it was always so much fun to be with you at conventions and other activities of the democratic party. you were always there and you've always been so honest and forthright in your commitment to the bayview hunters point community, but also to the people of the city and county of san francisco. and on behalf of all of them, we say thank you. and come up here for a photo op. [laughter] (applause)

>> i think i'm going to have you speak from the ross strum if that's okay with the rest of the commissioners. [speaker not understood]. [laughter]

trum if that's okay with the rest of the commissioners. [speaker not understood]. [laughter] >> say a few words. i want to get you comfortable. [laughter] i would like to say this is greatly an honor. i've never known a department to do what you've just done for me today. i want to thank you. i want to thank the people in the audience, my family and friends. i would also like to say that, yes, i support and i am the ambassador, i was given that title by ms. kay. -- ms. caen. she's not here today. the ambassador for this department. and i would like to say that i'm happy that those of you that i've been knowing for years -- [laughter] -- and have worked with, i understand the fact that i'm

for the community. i'm for the citizens of san francisco. it's just not black folk, but all folk. >> here, here. because of the fact we all have the same needs. and i want to thank you for making sure that your staff work with us, especially with me, to make sure that i get what i want. [laughter] for the southeast facility community college. i haven't gotten it all yet, but i'm looking to receive the rest of it. and when i say "the rest of it" i mean all of the college for the students, because we lost a lot of our programs because of greed, of people that just did not understand what that facility building was built for. so, i want to thank you, thank all of you and i love all of you. and, yes, i call my baby -- i call him my baby over there. i call him in the morning, i call him at night. and if he don't answer, he will

answer. [laughter] i have a little story to tell. i wasn't getting what i was pleased to receive and i called the mayor and left a message on the mayor's cell phone about i'm not satisfied with puc and what's happening with my college. so, that monday he called kelly and he said, kelly, you better contact espinola jackson because she's talking about blowing up your building. [laughter] and he called right away and he said, we will be meeting friday. i said, thank you very much. and i want to thank you, sweetheart, for working with us and doing the best that you can. and like i stated to you, i will be watching your back. and you have staff that will be watching your back because we love what puc was put here to do and we will be working with all of you. and thank you all again so

much. and thank you for coming, my prayers and my family for coming today. (applause) l >> we'll have ann sign it the next meeting. >> thank you, espinola, for your consistent humility and modesty. please continue. >> so, the next item is [speaker not understood] update on the [speaker not understood] program. >> we're sorry you couldn't connect the computer. i'm not sure what dr. jackson's

secret is, but i sure would like to look like that at the age of 80. so, okay, we're up. so, today i will give you an update basically on the -- that covers the last three months of 2002. >> 12. >> and this is the chart you used to receive. as of the end of the reporting period we were 70% complete with the program and now we're -- staff is approaching the 75% completion date. 17 project active and construction, in january you approved the construction contract for the san antonio back up pipeline. we now have 18 projects in construction and only have five remaining project in pre-construction. two of those are supporting projects that do not contribute to the los goals of the program. we essentially have only one seismic project that i've yet to enter construction.

so, we're definitely ramping down here quickly. now, following the largest cost increase forecasted in the program last quarter due to the deferring site conditions at cal var as, we are now forecasting the overall cost of the program to be slightly over the approved budget of $4.6 billion. specifically, our forecast is now $17.6 million above the currently approved budget. and the projects that have the largest forecasted cost increases of course include the calaveras project, they also include the peninsula pipeline seismic upgrade, the bioregional habitat restoration as well as the sunol valley water treatment plant. and in a recent presentation i talked to you about potential areas of savings in the program and we're definitely looking at that. and we want to move all these savings to the program

management reserve in an effort to try to compensate for these forecasted increases. and talking about the program management reserve, as of the end of the reporting quarter, the end of 2012, we had a balance of 117 million. at our last meeting you approved the transfer of that balance to the calaveras dam project so that leaves us with a zero balance. this is why it is so important for us to identify those savings and also be very diligent about the ramping down of all our program resources. and in the last slide, i will also go over an assessment that we're conducting to focus on those savings and how best to control costs and schedule for the remainder of the program. we have a number of accomplishments during the reporting period. i think note worthy is the fact that our man-hour, construction

man-hour reported we are clearly past the peak of construction. back in august we experienced that peak. we had 206,000 men hourses recorded that month. in december * , four months later we had a 35% decrease. we were spending at 132,000. i just got the number for january and we are at 125,000. so, the ramping down continues. during the reporting period we reached substantial -- final completion on two proprojects and we also awarded one more contract, the san antonio back up line contract. for your information, that contract was 9% below engineer's estimates. * during the reporting period we also completed the last segment of the bay division pipeline project. that was a tunnel in the peninsula. that tunnel is now being connected to the rest of the pipeline, bdpl-5. in a missouri or two at the latest we will have beneficial

use of the eastern and western segment of bdpl-5. i also mentioned to you in one of the update -- recent update we also now have beneficial use of the crystal springs pipeline number 2 in the peninsula, making our system more reliable because this is an area that is under the influence of the san andreas fault. i didn't want to mention the unfortunate hold through on the bay tunnel because this is by far one of our most significant milestones. after all, this is one of the first -- it is the first true tunnel under san francisco bay. so, what we're doing right now is getting ready to install the 9-foot diameter pipeline that will be inside the tunnel and that installation will -- is projected now to be completed by the end of the year. and we're well ahead of schedule on that project. the bioregional habitat restoration program is one that we don't talk about very often, but it is very important.

it's a program that provides a coordinated and consolidated approach to compensating all the environmental impacts of the wsip. it includes a number of enhancements and restores and creates environments to benefit threatened and endangered species. the photo here is a photo of the adobe [speaker not understood]. this is in the peninsula watershed. this will help create environments for the san francisco gardner stake and western pond turtle. we have currently six active projects on both the peninsula and the sunol region, and three more will be undertaken later this year. now, of course, we need to speak about cal aver as. following your approval of revisions at the last meeting, we are now seeking approval from the board budget and finance committee tomorrow actually for transferring the

$117 million from the reserve to the project. * at the same time we have begun negotiation sessions with the contractor and we are very close now to a final agreement on the schedule side of things. so, this is good news. we are really much focusing on the negotiation of direct cost impacts. and by the end of this week i anticipate that we will probably either have an agreement on those or we will have identified specific discrepancies and a way to get, you know, the way to move forward with those discrepancies. however, where the most significant disagreementses are likely is on what we call indirect costs. that includes filled and home office overhead, smart cups, insurance and bonds. so, we are going to going to be start focusing on that next week. i hope we can conclude all our

negotiations by the end of february, early march. and i wanted to end my presentation with -- by letting you know that we have undertaken a very comprehensive assessment of all our remaining projects, and they are three major elements to that assessment, construction costs, project delivery costs as well as project schedule. and the main objective of that assessment are to, of course, validate all our forecast costs and scheduled forecasts, identify any cost saving that can be moved to the program management reserve. any actions that need to be taken to recover any schedule delays, and finally put in place some specific measures that will allow us to further control costs and schedule up to the end of the program. this work will also allow us to respond to the 10 recommendation by bosca that you approved at the last commission as part of your resolution for the revision of the cal aver as dam project. and the final outcome of this

assessment will be a presentation to you to propose final project revisions and we'll do that on april 23rd. at the same time, there is an odd taking place performed by rw buff for our oversight committee. recommendations on that audit are scheduled to come out about the same time next month or two and we'll make sure to take into account these recommendations in the final plan that we will put in place to control all our final program implementation on the cost side and schedule side. and that concludes my presentation. i'd be happy to answer any questions. >> yes, i have one. >> okay. >> on master page 3, rather, of the program cost trend. * bawsca >> yes. >> could you be more definitive as what caused the 17.6 million? did you say that was cal aver as included within those numbers? >> yes, the big jump of the

last month -- at the last quarter with cal aver as, the additional 17 there includes a little bit more of cal aver as. there is also some forecasted increase on one of the project, the only seismic project that is still pre-construction. that is the peninsula, sunol water project treatment plant had to be closed out, had deferral plant conditions. >> the first one was the pipeline? >> peninsula pipeline. it is a project pre-construction. the original budget -- the budget for that project was inadequate. and through design we're finding that there needs additional improvements. >> all right. any other questions? thank you. next. >> todd will give an update on the bond. >> if i could ask sfgtv to focus on the overhead projector.

okay. while that comes up i wanted to report out some very good news for you today. we had much better and much lower borrowing rates than what we had projected in our sewer bonds which occurred this morning at 8:00 a.m. we had eight bidders. they were very aggressively seeking to own our sewer bonds and the winning bidder was goldman sachs, buying the entire 330 million plus bonds. what this meant, though, for our rate payers is that our rate payers will see $150 million of savings because the bonding rate we got was so low. 30 years of borrowing at averaged about just over 3.578% was the winning bid. this means $150 million of rate payer saving over 30 years averaging $5 million a year.

so, very good news. thought you'd like to know that. >> yea. (applause) >> would it be inappropriate -- i know it's not on the agenda, but bawsca also had a significant bond sale with very positive results. could we report on that? >> have you completed your report? >> i have. >> then i have an amendment that i'd like to introduce with the indulgence of the commission. i don't think you have copies of it yet, but it's [speaker not understood]. resolve basically to authorize the general manager to update the ten-year financial plan, to incorporate by fiscal year the 150 million total rate payer savings which resulted from a successful sewer bond results achieved in today's 8:00 a.m. sale, as well as here by authorize the general manager to make technical adjustments to conform with the final sizing and timing of the recent successful bawsca water bond

sale, which commission moran referenced, which closes in late february and thereby adopts as duly amended for the aforementioned. i'd like to propose that as a motion. >> if i may for clarification. >> any comments? >> if i may for clarification, you'll be hearing that item number 10 a little later in the agenda. and because of this very good news, i would like to thank president torres for proposing that friendly amendment which then you'll have for consideration as well during agenda item 10. >> [speaker not understood]. >> this item isn't up yet. i mean, it's been introduced, but we're still going to hear the finance -- >> yes. >> it's just related to the good news. >> all right. >> congratulations, thank you. >> is there a motion? >> oh, you want to do it at item 10? you wanted to have art come forward? >> yes. >> i'm sorry, professor jensen. >> thank you, mr. president,

members of the commission. art jensen with bawsca. on thursday, the 31st, we completed the issuance of bonds back in new york. we ended up -- we had taxable and tax exempt bonds. we ended up with a combined interest rate of 3.14%. it was a very successful issuance. we had a conservative, appropriately conservative estimate of saving the customers 20 to $30 million. the savings end up penciling out at over $62 million. >> congratulations. >> thank you very much. >> now, who bought your bonds? >> pardon me? >> who bought your bonds? >> goldman handled -- they were the lead manager. it went to a variety of retail institutional investors. >> institutional investors. >> it was a great thing to witness and very educational. >> the county seems -- economy seems to be coming back.

imagine that, and romney isn't president. thank you. [laughter] >> the last item i would like to point out that david hoff child would like to congratulate him. the governor just selected him as the commissioner of the california energy commission. >> our condolances. [laughter] >> so, we're looking forward to be working with him. >> i am, too. i think it's a tremendous challenge and a tremendous opportunity right now that we see for the state, especially in so many -- in so many areas. again, i want to thank the governor for his vision in some of these appointments because they've been pretty good protectors of the environment he's appointed. all right. >> that concludes my report. >> any public comments on the general manager's? david very briefly. i was out of the room a moment ago. but i understand todd mentioned the bond sale and i really wanted to appreciate staff again for continuing work on behalf of the rate payers and also to the now appointed

commissioner hoff child a former member of this commission. >> yes. so good for all of us. thank you very much. >> thank you. yes. mr. dicosta. i wanted to talk a little bit about espinola jackson and the water system improvement project and the bond measure. may i take the liberty to first wish one of your commissioners on friday, it's your birthday and that's because you are my facebook. [laughter] and i want to wish -- i want to express my deep condolances to karen cubic on the passing of her father. karen is -- karen, myself share something very deep and i appreciate her very hard work.

now, having said that, on espinola jackson, you know that she is one of the last leaders left that can do what she does, you know. she does it openly and she's very forthright, and i appreciate very much on behalf of the whole community the bayview hunters point for what you all did for her today. and god will bless you for that. on the water system improvement project, we have accomplished a lot. and my only hope is that understanding what we did with the water system improvement project, that we bring forward the finer projects and apply them to the sewer system improvement project. now, regarding the bonds, i have had a few occasions to sit

down with your chief financial officer and get the relevant information so that we can share that information with our students, our university students with whom i work in a very focused way. the other thing i do is i get whatever historical books, the san francisco public utilities commission has made them read it so they can give their impressions and see how our students in our universities can contribute to their learning, either getting certified in certain things, or participating in whatever way. finally, you know, all this comes under the general manager of the san francisco public utilities commission. and with his